FX.co ★ Japan Services PMI Revised Slightly Higher

The S&P Global Japan Services PMI edged higher to 53.6 in July 2025, surpassing the preliminary estimate of 53.5 and improving from 51.7 in June. This marks the fourth consecutive month of expansion and the fastest growth rate seen since February. The boost in new orders was the strongest in three months, driven by enhanced customer demand and successful business initiatives. However, foreign demand took a downturn for the first time since December, declining at the most significant rate in over three years. This drop was attributed to some companies reporting a decrease in tourist numbers due to concerns over earthquakes. Employment levels remained steady, bringing to an end a 21-month streak of job growth, and resulting in further increases in backlogs, the sharpest since last November. While input cost inflation decreased to its lowest in 17 months, it remained high, compelling companies to increase their output charges notably. On the other hand, business confidence for the upcoming year fell to its lowest point in three months.